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Domino’s pizza And Papa John’s Both fell in pre-market trading after posting mixed earnings Thursday morning.
It missed Domino’s analyst estimates for US same-store sales and total revenue for the quarter. Domino’s also lowered its outlook. Papa John’s announced lighter-than-expected sales in North America.
Domino’s stock closed down more than 11%, while Papa John’s stock was down 6%.
Both pizza companies recently raised prices to offset higher food, transportation and labor costs. Domino’s wavering demand wavered amid a lack of national drivers. Last October, Domino’s executives announced plans to raise prices by about 7% in the fourth quarter, including increasing the Mix & Match deal from $5.99 to $6.99.
Here’s how Domino’s did, compared to analyst estimates, according to Refinitiv:
- Revenue: $1.39 billion vs. $1.44 billion expected
- Adjusted earnings per share: $3.97 vs. $3.94 expected
The Michigan-based company said same-store sales in the United States increased 0.9%, well below analyst estimates of 3.4%, according to estimates compiled by StreetAccount. This was a decrease of 0.8% for the 2022 fiscal year.
The US-owned stores reported revenue of $117 million, which was lower than StreetAcount’s estimate of $129.3 million.
The company cut its two- to three-year sales forecast to a range of 4% to 8% growth from 6% to 10%, citing macroeconomic headwinds weighing on its domestic delivery business.
Revenue grew 3.6% in the fourth quarter of 2022 compared to the same period a year earlier, citing higher supply chain revenue as a result of increases in market basket prices for stores.
This month, Domino’s launched a loaded fries in three flavors, which some analysts think could boost sales.
“We had significant pressure on the US delivery business in 2022 and focused our efforts on finding solutions,” said CEO Russell Weiner. “We also generated continued momentum in our US business and delivered strong international store growth.”
Papa John’s pizza delivery bikes parked outside their London branch.
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Papa John’s fourth quarter results beat Wall Street expectations. Total revenue fell less than 1% compared to the company’s record fourth quarter last year. Revenue would have risen by 3% had it not been for the strategic re-franchising of dozens of restaurants.
Here’s how Papa John’s did, compared to analyst estimates, according to Refinitiv:
- Revenue: $526.2 million vs. $523.8 million projected
- Adjusted earnings per share: $0.71 vs. Expected $0.66
The Louisville-based company didn’t miscalculate with company-owned restaurant sales in North America, reporting revenue of $172.2 million versus an expected $172.7 million, according to estimates compiled by StreetAccount. Comparable sales in North America were up 1% from a year ago.
The company said it expects comparable sales in North America to grow annually between 2% and 4%, according to executives. For 2023, they added, you would expect growth to come in at the lower end of that range.
Earnings for both Domino’s and Papa John’s came after stronger-than-expected earnings McDonald’s And Yum! Trademarksboth of which exceeded earnings and quarterly revenue estimates this quarter.